The Bosphorus presumption is still alive and kicking: the case of Avotiņš v. Latvia

Yesterday, 23 May 2016, the Grand Chamber of the European Court of Human Rights (ECtHR) delivered its judgment in the case of Avotiņš v. Latvia. This seems to be the ECtHR’s first detailed appraisal of the so-called Bosphorus presumption after the Court of Justice of the European Union (CJEU) in Opinion 2/13 rejected a draft agreement providing for the accession of the EU to the European Convention of Human Rights (ECHR). It also provides a first glimpse of how the ECtHR views the EU law principle of mutual trust, which has become particularly dear to the CJEU over the last couple of years.

The Bosphorus presumption and Opinion 2/13

For the uninitiated: the Bosphorus presumption refers to a doctrine in the case-law of the ECtHR that goes back to the 2005 judgment in Bosphorus Hava Yolları Turizm ve Ticaret Anonim Şirketi v. Ireland. In that judgment the ECtHR first stated, in line with previous case-law, that member states of an international organization (such as the EU) are still liable under the ECHR for “all acts and omissions of its organs regardless of whether the act or omission in question was a consequence […] of the necessity to comply with international legal obligations” (Bosphorus para 153). It also recognized “the growing importance of international cooperation and of the consequent need to secure the proper functioning of international organisations” (Bosphorus para. 150). In an attempt to reconcile these two positions, the ECtHR established what is now known as the Bosphorus presumption or the presumption of equivalent protection:

155. In the Court’s view, State action taken in compliance with such legal obligations is justified as long as the relevant organisation is considered to protect fundamental rights, as regards both the substantive guarantees offered and the mechanisms controlling their observance, in a manner which can be considered at least equivalent to that for which the Convention provides […]. By “equivalent” the Court means “comparable”; any requirement that the organisation’s protection be “identical” could run counter to the interest of international cooperation pursued […]. However, any such finding of equivalence could not be final and would be susceptible to review in the light of any relevant change in fundamental rights protection.

156. If such equivalent protection is considered to be provided by the organisation, the presumption will be that a State has not departed from the requirements of the Convention when it does no more than implement legal obligations flowing from its membership of the organisation.

However, any such presumption can be rebutted if, in the circumstances of a particular case, it is considered that the protection of Convention rights was manifestly deficient.

Many have been curious about whether the ECtHR would modify the Bosphorus presumption following the rather belligerent rejection of EU accession to the ECHR by the CJEU in Opinion 2/13. In the foreword of the ECtHR’s 2015 Annual Report its President, Guido Raimondi, indeed seemed to signal an interest in shaking things up (emphasis added):

The end of the year was also marked by the delivery on 18 December 2014 of the Court of Justice of the European Union’s (CJEU) eagerly awaited opinion on the draft agreement on the accession of the European Union to the European Convention on Human Rights. [T]he CJEU’s unfavourable opinion is a great disappointment. Let us not forget, however, that the principal victims will be those citizens whom this opinion (no. 2/13) deprives of the right to have acts of the European Union subjected to the same external scrutiny as regards respect for human rights as that which applies to each member State. More than ever, therefore, the onus will be on the Strasbourg Court to do what it can in cases before it to protect citizens from the negative effects of this situation.

Yet, in the ECtHR Grand Chamber judgment in the case of Avotiņš v. Latvia, it can clearly be seen that – spoiler alert – the Bosphorus presumption is still alive and kicking. Indeed, as I will show below, the ECtHR for the first time applies it to a case concerning obligations of mutual recognition under EU law. This is notable, since one of the main arguments the CJEU put forward in Opinion 2/13 was that EU accession to the ECHR posed such a big threat to the principle of mutual trust that it would “upset the underlying balance of the EU and undermine the autonomy of EU law” (Opinion 2/13 para 194).

Background of the case

A hearing at the Latvian Supreme Court.

Before we look at how the Grand Chamber applied the Bosphorus, it is necessary to summarize the key facts of the case. Mr Pēteris Avotiņš is a Latvian national, who in May 1999 borrowed 100 000 US dollars from a company named F.H. Ltd. and undertook to repay that sum with interest by 30 June 1999. The loan contract was governed by Cypriot law, and Cypriot courts had non-exclusive jurisdiction to hear any disputes arising out of it.

In 2003, F.H. Ltd. brought proceedings against Avotiņš in a Cypriot district court, alleging that he had not repaid the above-mentioned debt. Since Avotiņš did not reside in Cyprus, notice of the proceedings and summons to appear had to be served on the applicants by Latvian authorities. There is some factual disagreement regarding the serving of this application (see para 19 of the judgment). It seems as if the summons slip had been signed, but the signature on the slip did not appear to correspond to the applicant’s name. Nevertheless, the Cypriot court ruled in Avotiņš’ absence on 24 May 2004, and ordered him to pay F.H. Ltd. 100 000 US dollar plus interest. According to the Cypriot judgment, the applicant had been duly informed of the hearing, but had not attended.

In February 2015, F.H. Ltd. applied to the Riga City District Court seeking recognition and enforcement of the Cypriot judgment. This request was first rejected, due to discrepancies regarding the postal address of Mr. Avotiņš. This rejection was appealed by F.H. Ltd. to the Riga Regional Court, which quashed the District Court’s rejection. Upon reexamination of F.H. Ltd.’s application by the District Court the application was granted in full – without the parties being present.

According to Avotiņš, it was not until 15 June 2006 that he became aware of the Cypriot judgment and the District Court order for its enforcement. He contacted the District Court immediately and acquainted himself with the Cypriot judgment and the Latvian order. Interestingly, before the ECtHR the Latvian authorities did not dispute these facts.

This is where things get complex (see paras 27-35 of the judgment), and I can for the sake of brevity only give a brief summary of the facts from this point out. First, Avotiņš did not attempt to appeal the Cypriot judgment. However, he decided to appeal the Latvian enforcement order on the grounds that it violated the Brussels I regulation, which is part of EU law, as well as rules of Latvian civil procedure. Second, the Regional Court in October 2006 accepted Avotiņš’ submissions, and quashed the enforcement order. The Regional Court seemed to have found that the Cypriot judgment was not enforceable due to the lack of the certificate referred to in Article 54 of the Brussels I regulation. Third, F.H. Ltd. appealed the October 2006 order of the Regional Court to the Supreme Court. At the start of the Supreme Court hearing in January 2007 F.H. Ltd. submitted copies of inter alia the certificate referred to in Article 54 of the Brussels I regulation. Later the same day the Latvian Supreme Court quashed the October 2006 order of the Regional Court, and ordered the recognition and enforcement of the Cypriot judgment. In doing so, the Supreme Court held that under article 36 of the Brussels I regulation a foreign judgment “may under no circumstances be reviewed as to its substance” (para 34 of the judgment, citing the January 2007 judgment of the Latvian supreme court).

The case before the ECtHR

The applications

Avotiņš then filed complaints against Latvia and Cyprus before the ECtHR. The application against Cyprus was rejected, due to being too late (see para 97 of the judgment, referring to a ECtHR decision of 3 March 2010). However, his application against Latvia was filed within the time-limits.

In his application against Latvia, Avotiņš argued that the Latvian Supreme court had infringed his right to a fair hearing, by recognizing and enforcing the Cypriot judgment which in his view was defective as it had been given in breach of his right to a defense. Several third parties intervened in the latter case, including the European Commission, which provided a lengthy submission on the applicability of the Bosphorus presumption to the case and the compatibility of Brussels I regulation with ECHR article 6.

The ECtHR’s introductory remarks

The judgment of the ECtHR, which was adopted by a majority of sixteen votes to one (with two judges appending a joint concurring opinion), opens with the premise that ECHR article 6 is applicable to the execution of foreign final judgments. According to the Court (para 98 of the judgment):

a decision to enforce a foreign judgment cannot be regarded as compatible with the requirements of Article 6 § 1 of the Convention if it was taken without the unsuccessful party having been afforded any opportunity of effectively asserting a complaint as to the unfairness of the proceedings leading to that judgment, either in the State of origin or in the State addressed.

The ECtHR then noted that it had “never previously been called upon to examine observance of the guarantees of a fair hearing in the context of mutual recognition based on European Union law” (para 98). However, the ECtHR added it had “always applied the general principle” that a request for recognition and enforcement of foreign judgments cannot be granted without the court examining the request “first conducting some measure of review of [the foreign] judgment in light of the guarantees of a fair hearing”.

Does the Bosphorus presumption apply?

Following these initial remarks, the ECtHR went on to consider whether and to what extent the Bosphorus presumption was applicable to the case. It did so over ten pages (paras 101-127), making this probably the longest treatment of this famed presumption by the ECtHR to day.

First, on the scope of the Bosphorus presumption, the ECtHR confirmed the principles laid down in its previous by referring to the summary of that case-law in paras 102-104 of its judgment in the Michaud case. From that case-law it follows that the substantive protection of human rights in the area of EU law that the Brussels I regulation belongs to is equivalent. In particular, this is confirmed by article 52(3) of the EU’s Charter of Fundamental Rights. The fundamental condition for applying the Bosphorus presumption was thus fulfilled.

Next, it follows from the ECtHR’s case-law that two further conditions must be satisfied for the Bosphorus presumption to apply. These are (1) the “absence of any margin of manouvre” on the part of the domestic authorities implementing an EU law obligation, and (2) the “deployment of the full potential of the supervisory mechanism” provided for under EU law. Applying these principles to the present case, the ECtHR first found that the Latvian Supreme Court did in fact not have any margin of manoevre in this case. In coming to this conclusion, the ECtHR pointed to the CJEU’s case-law on the relevant provisions of the Brussels I regulation, which “did not confer any discretion on the court from which the declaration of enforceability was sought” (para 106 i.f.).

The ECtHR’s discussion of the second condition, the deployment of the full potential of the supervisory mechanisms under EU law, was much more extensive. The Latvian Supreme Court had not requested a preliminary ruling from the CJEU regarding the interpretation of the relevant provisions of the Brussels I regulation. However, this was not decisive for the ECtHR, which stated (para 109):

this second condition should be applied without excessive formalism and taking into account the specific features of the supervisory mechanism in question. It considers that it would serve no useful purpose to make the implementation of the Bosphorus presumption subject to a requirement for the domestic court to request a ruling from the CJEU in all cases without exception […].

Following this statement, the ECtHR referred to cases where it has found that ECHR article 6 require domestic apex courts to give reasons when they refuse to refer questions to the CJEU for a preliminary ruling, “in light of the exceptions provided for by the case-law of the CJEU” (para 110). However, the ECtHR was quick to add that the review conducted in those cases differs from that in the present case, where “it examines the decision not to request a preliminary ruling as part of its overall assessment of the degree of protection of fundamental rights afforded by European Union law” (para 110).

For those reasons, the ECtHR found that “whether the fact that the domestic court hearing the case did not request a preliminary ruling […] is apt to preclude the application” of the Bosphorus presumption “should be assessed in light of the specific circumstances in each case” (para 111). It then pointed to the relevant circumstances at play in the present case: Avotiņš “did not advance any specific argument concerning the interpretation” of the relevant provisions of the Brussels I regulation, and he did not request that the Latvian Supreme Court should ask the CJEU for a preliminary ruling (para 111). Since there was thus no request for a preliminary ruling, the fact that the Latvian Supreme Court did not ask for a preliminary ruling was not “a decisive factor” (para 111). Consequently, the ECtHR found that also the second condition for the application of the Bosphorus presumption was satisfied.

Was the protection of ECHR rights “manifestly deficient”?

A finding that the Bosphorus presumption applies is not the end of it, however, since that presumption can be rebutted if the protection of the rights laid down in the ECHR was “manifestly deficient” in the present case (para 112). In the opening paragraph of this part of the judgment, the ECtHR points to the fact that the Brussels I regulation is based on the principle of mutual trust, and affirmed the importance of this principle in EU law (para 113):

The Court is mindful of the importance of the mutual recognition mechanisms for the construction of the area of freedom, security and justice referred to in Article 67 of the TFEU, and of the mutual trust which they require.

Nevertheless, the ECtHR soon went on to stress that the “methods used to create that area must not infringe the fundamental rights of the persons affected by the resulting mechanisms, as indeed confirmed by Article 67(1) of the TFEU” (para 114). This statement was immediately followed by some key critical remarks (para 114, emphasis added):

However, it is apparent that the aim of effectiveness pursued by some of the methods used results in the review of the observance of fundamental rights being tightly regulated or even limited. Hence, the CJEU stated recently in Opinion 2/13 that “when implementing EU law, the Member States may, under EU law, be required to presume that fundamental rights have been observed by the other Member States, so that …, save in exceptional cases, they may not check whether that other Member State has actually, in a specific case, observed the fundamental rights guaranteed by the EU” […]. Limiting to exceptional cases the power of the State in which recognition is sought to review the observance of fundamental rights by the State of origin of the judgment could, in practice, run counter to the requirement imposed by the Convention according to which the court in the State addressed must at least be empowered to conduct a review commensurate with the gravity of any serious allegation of a violation of fundamental rights in the State of origin, in order to ensure that the protection of those rights is not manifestly deficient.

By thus requiring domestic courts to presume the observance of fundamental rights by other member states, as the EU law principle of mutual trust requires, the domestic courts are “deprived of […] discretion in the matter, leading to automatic application of the Bosphorus presumption” (para 115). Although it is a bit difficult to discern exactly what the ECtHR is alluding to here, it is hard to disagree that the nature of the mutual trust principle creates a paradoxical situation (para 115 i.f.);

a twofold limitation of the domestic court’s review
of the observance of fundamental rights, due to the combined effect of the presumption on which mutual recognition is founded and the Bosphorus presumption of equivalent protection.

However, despite these apparent limitations on domestic courts when the principle of mutual trust is at play, the ECHR, which is a “constitutional instrument of European public order”, nevertheless requires of them to ensure that there is no manifest deficiencies (para 116, emphasis added):

Accordingly, the Court must satisfy itself […] that the mutual recognition mechanisms do not leave any gap or particular situation which would render the protection of the human rights guaranteed by the Convention manifestly deficient. In doing so it takes into account, in a spirit of complementarity, the manner in which these mechanisms operate and in particular the aim of effectiveness which they pursue. Nevertheless, it must verify that the principle of mutual recognition is not applied automatically and mechanically […] to the detriment of fundamental rights – which, the CJEU has also stressed, must be observed in this context […]. In this spirit, where the courts of a State which is both a Contracting Party to the Convention and a Member State of the European Union are called upon to apply a mutual recognition mechanism established by EU law, they must give full effect to that mechanism where the protection of Convention rights cannot be considered manifestly deficient. However, if a serious and substantiated complaint is raised before them to the effect that the protection of a Convention right has been manifestly deficient and that this situation cannot be remedied by European Union law, they cannot refrain from examining that complaint on the sole ground that they are applying EU law.

The test laid down in the final sentence of the quoted paragraph is a tough one. It is therefore no surprise that Mr. Avotiņš was unable to meet its criteria.

What is more surprising, though, is how close he got to doing so. Although the ECtHR found the system of mutual recognition in the Brussels I regulation to be generally compatible with ECHR article 6 (paras 117-119), the ECtHR was skeptical about the Latvian Supreme Court’s interpretation and application of that regulation. Avotiņš had, as mentioned above, argued that the application for recognition of the Cypriot judgment should have been refused. According to the ECtHR he

“raised cogent arguments in the Latvian courts alleging the existence of a procedural defect which, a priori, was contrary to [ECHR article 6] and precluded the enforcement of the Cypriot judgment in Latvia”. (para 120 i.f., emphasis added)

Moreover, the ECtHR found that the Latvian Supreme Court applied provisions of the Brussels I regulation that provided for exceptions to the obligation of mutual recognition too mechanically. The details here are quite technical, and concern the determination of the burden of proof – an issue that is not governed by EU law. In its concluding appraisal of the Latvian Supreme Court’s approach, the ECtHR stated (para 121):

This approach, which reflects a literal and automatic application of Article 34(2) of the Brussels I Regulation, could in theory lead to a finding that the protection afforded was manifestly deficient such that the presumption of equivalent protection of the rights of the defence guaranteed by Article 6 § 1 is rebutted.

This is as close to a finding of “manifest deficiency” as we have ever gotten in the ECtHR’s case-law – more on that later – but again the specific circumstances of the case came to the rescue. According to Cypriotic law Avotiņš had a “perfectly realistic opportunity” of appealing the seemingly final judgment (para 122). That the applicant was unaware of this opportunity did not matter, as he when entering into a loan agreement should have “ensured that he was familiar with the manner in which possible proceedings would be conducted before Cypriot courts” (para 124).

Consequently, the judgment fizzles out with a finding that the protection of fundamental rights was not manifestly deficient, in the specific circumstance of the present case (para 125).

CommentS

This judgment is notable for at least three reasons. First, it is notable for simple fact that it is the first time the Grand Chamber applies the Bosphorus presumption since Opinion 2/13. The judgment confirms that the presumption is still alive and well, as one could probably expect despite some murmuring from the ECtHR president.

Second, it is notable for being the first case where the ECtHR goes right up to the edge of finding that a “manifest deficiency” in the protection of fundamental rights has occurred, but then backing off at the last second because of a specific feature of the case at hand. As a side note, though, the ECtHR’s reasoning is less clear than one could have hoped for here. Since the burden of proof seems to be key to the outcome of the Latvian Supreme Court’s judgment, and this is an issue that is not regulated by EU law, one might have argued that the Latvian Supreme Court did in fact have some “margin of manouvre”. It seems as if it could have complied with both the obligation of mutual recognition and ECHR article 6 by modifying the Latvian rules on the burden of proof. The reason for the lack of clarity on the part of the ECtHR here may be caused by opaqueness of the Latvian Supreme Court’s reasoning; it “tacitly presumed either that the burden of proof laid with [Avotiņš] or that [a remedy against the Cypriot judgment] had in fact been available to the applicant” (para 121).

Third, the case is notable for being the first where Bosphorus presumption takes the principle of mutual trust head on. Particularly because that principle has been elevated to constitutional status by the CJEU over the last couple of years – with Opinion 2/13 as a major catalyst (see, particularly, Opinion 2/13 paras 191-194). The ECtHR’s judgment is wary of the dangers of mechanical application of mutual trust obligations, and reaffirms the principles laid down in Bosphorus. Despite some critical comments, my best guess is that the CJEU will see this judgment as something of an olive branch from the ECtHR. From the CJEU’s perspective the case is indeed welcome, as cases concerning the Dublin Regulation (e.g. M.S.S. v. Belgium and Greece), where the ECtHR have found that EU member states violated ECHR article 3 by sending asylum seekers back to the first EU country they entered, have not been well received. However, one must not forget that there are important legal differences between cases such as M.S.S. and the present case of Avotiņš. Notably, the Dublin regulation does not – despite myths to the contrary – contain any obligation to send asylum seekers back to the first EU country they entered. In Avotiņš the situation is markedly different: there is seemingly a clear obligation on the Latvian authorities to recognize and enforce the Cypriot judgment. Although, admittedly, the ECtHR’s unclear reasoning concerning the Latvian rules on burden of proof makes this distinction a bit less clear.